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The Implementation Axiom
Organizations do not implement strategies,
PEOPLE DO!
Gaining the cooperation, trust, and commitment of
employees is the key to marketing implementation
Nature of Strategic Planning
The Strategic Planning, Implementation,
and Control Process
Marketing Implementation
 Marketing implementation is the process of
executing the marketing strategy by creating
specific actions that will ensure that the marketing
objectives are achieved.
 Marketing implementation is the process that
turns marketing plans into action assignments and
ensures that such assignments are executed in a
manner that accomplishes the plan’s stated
objectives (Kotler 1997)
MARKETING IMPLEMENTATION
 Marketing strategies almost always turn out
differently than anticipated because of the difference
between intended marketing strategy and realized
marketing strategy.
 Intended marketing strategy is what the
organization wants to happen; it is the organization's
planned strategic choice.
 Realized marketing strategy is the strategy that
actually takes place.
The Marketing Implementation Process Problems in Implementing Marketing Activities
 Marketing Strategy (planning) and
Implementation Are Related
 Marketing Strategy (planning) and
Implementation Are Constantly Evolving
 Marketing Strategy (Planning) and
Implementation Are Separated
Planning and Implementation Are Related
Processes
 Strategy has to be realistic and has inputs how
realistically it has to be implemented.
 Certain Strategies are drawn based on implementation
phase.
 Certain marketing strategies will dictate some parts of
their implementation.
Planning and Implementation Are
Constantly Evolving
 The reality of marketing is that critically important
environmental factors are constantly shifting.
 As customers change their wants and needs, as competitors devise
new marketing strategies, and as the organization's own internal
environment changes, the firm must constantly adapt.
 Because of the interrelationship between marketing strategy and
marketing implementation, both must constantly change.
 Managers often assume that there is one correct way to
implement a given strategy.
 Just as strategy often results from trial and error, so does
marketing implementation.
 The fact that marketing is customer-driven (marketing concept)
requires that the organization be flexible enough to alter its
implementation to counter changes in its customers' preferences
or the competitive environment.
Planning and Implementation Are Separated
 The ineffective implementation of marketing strategy is
often a self-generated problem stemming from the
planning process itself.
 While strategic planning is carried out by top managers, the
responsibility for implementing marketing plans falls on lowerlevel managers and frontline employees.
 Because top managers are separated from the "front line" of the
organization, they often do not understand the unique problems
associated with implementing marketing strategies.
 Conversely, those employees who do understand the problems of
marketing implementation usually have no voice in developing the
marketing plan.
 Another trap that top managers often fall into is believing
that lower-level managers and frontline employees will be
excited about the marketing strategy and motivated to
implement it.
Effective implementation: four skills
 YOU NEED SKILLS IN:
 Recognizing and diagnosing a problem
 Assessing the company level where the problem
exists
 Implementing plans
 Evaluating and implementing results
The Marketing Implementation Process Components of Marketing Implementation
Marketing
control
Marketing
structure
Leadership
Shared goals
and objectives
Total quality
management
Employees
Internal
marketing
The Components of Successful Marketing
Implementation
 Shared goals and values among all employees within the organization
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are the "glue" that binds the entire organization together as a single,
functioning unit.
Marketing structure refers to how an organization's marketing
activities are organized.
Organizational systems and processes are collections of work
activities that take in a variety of inputs to create information and
communication outputs that ensure the consistent day-to-day operation
of the organization.
An organization's resources can include a wide variety of assets that
can be brought together during marketing implementation.
People refers to the human side of marketing implementation, the "5th
P" of marketing.
Leadership, the art of managing people, includes how managers
communicate with employees, as well as how they motivate their people
to implement a marketing strategy.
Organization’s Shared Goals and Values
 Without a common direction to hold the organization
together, different areas of the company may work toward
different outcomes, thus limiting the success of the entire
organization.
 Institutionalizing shared goals and values within a firm's
culture is a long-term process.
 The primary means of creating shared goals and values is
through employee training and socialization programs.
 Creating shared goals and values is the most important part
of marketing implementation because it stimulates
organizational commitment where employees become more
motivated to implement the marketing strategy and meet
customer needs.
Organization’s Marketing Structure
 The organization's marketing structure establishes formal lines
of authority, as well as the division of labor within the marketing
function.
 Managers must decide how to divide and integrate marketing
responsibilities and how much to centralize decision making.
 In a centralized marketing structure, all marketing activities and
decisions are coordinated and managed from the top of the marketing
hierarchy. Centralized structures are very cost-efficient and effective in
ensuring standardization within the marketing program.
 In a decentralized marketing structure, marketing activities and
decisions are coordinated and managed from the front line of the
organization. Decentralized marketing structures have the advantage
of placing marketing decisions close to the front line where customer
needs are the priority.
Organizational Systems and Processes
 By providing a continuous flow of information, the
marketing information system (MIS) can assist in the
analysis of the internal and external environments
before marketing strategies are developed.
 The MIS is also used during implementation to assist
in the evaluation and control of all marketing
activities.
Organization’s Resources
 Organization assets may be tangible or intangible
 Tangible resources include financial resources,
manufacturing capacity, facilities, and equipment.
 Intangible resources include marketing expertise, customer
loyalty, and external relationships/strategic alliances.
 A critical and honest evaluation of available resources
during the environmental and SWOT analyses can help
ensure that the marketing strategy and marketing
implementation are within the realm of possibility.
 Once the marketing plan is completed, the manager
must seek the approval of needed resources from top
management.
Organization’s Leadership
 Leaders are responsible for establishing the corporate
culture necessary for implementation success.
 Marketing implementation is more successful when
leaders create an organizational culture characterized
by open communication between employees and
managers.
 One of the most important tasks leaders perform is to
motivate their employees to give their best effort.
 A final trait that all leaders possess is a leadership style,
or way of approaching a given task.
Organization’s People
 The implementation of any marketing strategy
depends on the quality, diversity, and skills of the
firm's work force.
 People are considered by many as the “5th P” of
marketing.
 The people component also includes employee
selection and training, reward policies, employee
motivation, commitment, and morale.
People: the Human Side of Marketing
Implementation
 Employee Selection and Training
 Employee Evaluation and Compensation Policies
 Employee Motivation, Satisfaction, and
Commitment
Employee Selection and Training
 One of the most critical aspects of marketing
implementation is matching employees' skills and
abilities to the marketing tasks to be performed
through employee recruitment, selection, and
training.
 One of the best ways to ensure a match of skills to
activities is to select individuals with raw abilities and
train them to perform certain tasks.
 Through training and socialization programs,
employees learn to understand what is expected of
them in implementing a marketing strategy.
 An increasingly important aspect of selection and
training practices is the management of employee
diversity, whether it be ethnic or generational.
Employee Evaluation and Compensation
Policies
 Develop an evaluation and compensation program
that ties employee rewards to performance levels on
required marketing activities.
 Employee evaluation and compensation should be
based on either outcome-based or behavior-based
control systems.
 Outcome-based control evaluates and compensates
employees based on measurable, quantitative standards, such
as sales volume or gross margin levels.
 Behavior-based control evaluates and compensates
employees based on subjective, qualitative standards such as
effort, motivation, teamwork, and friendliness
toward/problem solving with customers.
Employee Motivation, Satisfaction, and
Commitment
 This is the extent to which employees are motivated to
implement a strategy, their overall feelings of job
satisfaction, and the commitment they feel toward the
organization and its goals.
 While factors such as employee motivation, satisfaction, and
commitment are critical to successful implementation, they
are highly dependent on other components, especially
training, the evaluation/compensation system, and
leadership, as well as marketing structure and processes.
 The key is to recognize the importance of these factors to
successful marketing implementation, and to manage them
accordingly.
The Expanding Role of Internal Marketing
 Internal marketing refers to the managerial actions
necessary to make all members of the organization
understand and accept their respective roles in
implementing marketing strategy.
 Under the internal marketing approach, every employee has two
sets of customers: external and internal.
 Unlike traditional approaches where the responsibility for
implementation rests with lower levels of the organization, the
internal marketing approach places this responsibility on all
employees, regardless of organizational level.
 Successful marketing implementation comes from an
accumulation of individual actions where all employees are
responsible for implementing the marketing strategy.
The Four Ps of Internal Marketing
Internal Products
The marketing strategy
Employee tasks, behaviors, values, & attitudes
Internal Prices
Employees’ job-related changes
Working harder; expanding abilities
Internal Distribution
How the marketing strategy is communicated (e.g., planning
sessions, workshops, formal reports, employee training)
Internal Promotion
Informing and persuading employees about the merits of the
marketing strategy (e.g., speeches, newsletters, etc.)
Successful Implementing an Internal
Marketing Approach Requires
 The recruitment, selection, and training of employees must
be considered an important component of marketing
implementation.
 Top managers must be completely committed to the
marketing strategy and overall marketing plan.
 Employee compensation programs must be linked to the
implementation of the marketing strategy.
 The organization should be characterized by open
communication among all employees, regardless of
organizational level.
 Organizational structures, policies, and processes should
match the marketing strategy to ensure that the strategy is
capable of being implemented.
Approaches to Marketing Implementation
 Command approach
 Change approach
 Consensus approach
 Cultural approach
Approaches to Marketing Implementation
 With the command approach, marketing strategies are
evaluated and selected at the top of the organization and forced
downward to lower levels where frontline managers and
employees are expected to implement them.
 The change approach is similar to the command approach
except that it focuses explicitly on implementation.
 In the consensus approach, top managers and lower-level
managers work together to evaluate and develop marketing
strategies.
 The cultural approach carries the participative style of the
consensus approach to the lower levels of the organization.
The Command Approach
 The command approach has two advantages:
 It makes decision making easier.
 It reduces uncertainty as to what is to be done.
 The command approach has several disadvantages:
 It does not consider the feasibility of implementing the
marketing strategy.
 It divides the organization into strategists and
implementers, with no consideration for how strategy
and implementation affect each other.
 The command approach often creates employee
motivation problems.
The Change Approach
 The basic premise here is to modify the organization in
ways that will ensure the successful implementation of
the chosen marketing strategy.
 A manager taking this approach is more of an architect
and politician, skillfully crafting the organization to fit
the requirements of the chosen marketing strategy.
 The change approach still suffers from the issue of
separation of planning and implementation.
 This approach often take a great deal of time to design
and implement.
The Consensus Approach
 The underlying premise is that managers from different areas and
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levels of the organization come together as a team to "brainstorm"
and develop the marketing strategy.
Through this collective decision-making process, a marketing
strategy is agreed upon and a consensus reached as to the overall
direction of the organization.
This approach moves some of the decision-making authority closer
to the front lines.
The consensus approach often retains the barrier between strategists
and implementers.
Managers at all levels within the organization must communicate
openly about strategy on a daily basis, not just during formal
strategy development sessions.
This works best in complex, uncertain, and highly unstable
environments.
The Cultural Approach
 The basic premise is that marketing strategy is a part of the
overall organizational vision.
 The goal of top managers using this approach is to shape the
organization's culture in such a way that all employees—top
managers to janitors participate in making decisions that help
the organization reach its objectives.
 As a result, the cultural approach breaks down the barrier
between strategists and implementers so that all employees work
toward a single purpose.
 Employees are allowed to design their own work procedures, as
long as they are consistent with the organizational mission,
goals, and objectives. This extreme form of decentralization is
often called empowerment (i.e., allowing them to make decisions
on how to perform their jobs).
Marketing Control
Organizing Marketing Activities
The Role of Marketing in an Organization’s Structure
 Adopting the Marketing Concept
 Customer’s Needs Are Pivotal
 Concentrating on Discovering Buyers’ Wants and
Fulfilling Them So as to Achieve Organizational Goals
 Closer Coordination with Other Functional Areas
Organizing Marketing Activities
Alternatives for Organizing the Marketing Unit
Authority at This Level
Centralized
Organizing Marketing Activities
Alternatives for Organizing the Marketing Unit
Authority at This Level
Centralized
Decentralized
Organizing Marketing Activities
 Organizing by Functions
 Organizing by Products
 Organizing by Regions
 Organizing by Types of Customers
Implementing Marketing Activities
Motivating Marketing Personnel
Implementing Marketing Activities
Motivating Marketing Personnel
Communicating Within the Marketing Unit
Implementing Marketing Activities
Motivating Marketing Personnel
Communicating Within the Marketing Unit
Coordinating Marketing Activities
Implementing Marketing Activities
Motivating Marketing Personnel
Communicating Within the Marketing Unit
Coordinating Marketing Activities
Establishing a Timetable for Implementation
Controlling Marketing Activities
Marketing Control Process
Establishment
of Performance
Standards
Controlling Marketing Activities
Marketing Control Process
Establishment
of Performance
Standards
Evaluation
of Actual
Performance
Controlling Marketing Activities
Marketing Control Process
Establishment
of Performance
Standards
Corrective
Action if
Necessary
Evaluation
of Actual
Performance
Controlling Marketing Activities
Marketing Control Process
Establishment
of Performance
Standards
Corrective
Action if
Necessary
Evaluation
of Actual
Performance
Methods of Evaluating Performance
 Sales Analysis
Methods of Evaluating Performance
 Sales Analysis
 Marketing Cost
Analysis
Methods of Evaluating
Performance
Marketing Cost Analysis
LET’S GO OVER THE
FOUR BROAD CATEGORIES
OF COSTS IMPORTANT TO
MARKETING COST ANALYSIS
Methods of Evaluating Performance
Marketing Cost Analysis
Fixed
Costs
Methods of Evaluating Performance
Marketing Cost Analysis
Fixed
Costs
Variable
Costs
Methods of Evaluating Performance
Marketing Cost Analysis
Fixed
Costs
Variable
Costs
Traceable
Common
Costs
Methods of Evaluating Performance
Marketing Cost Analysis
Fixed
Costs
Traceable
Common
Costs
Variable
Costs
Nontraceable
Common
Costs
Fixed Cost, Variable Cost & Traceable Fixed Cost
 Fixed Cost
A periodic cost that remains more or less unchanged irrespective of the output
level or sales revenue, such as depreciation, insurance, interest, rent, salaries,
and wages.
While in practice, all costs vary over time and no cost is a purely fixed cost, the
concept of fixed costs is necessary in short term cost accounting.
 Variable cost
Variable costs are corporate expenses that vary in direct proportion to the
quantity of output. Unlike fixed costs, which remain constant regardless of
output, variable costs are a direct function of production volume, rising
whenever production expands and falling whenever it contracts. Examples of
common variable costs include raw materials, packaging, and labor directly
involved in a company's manufacturing process.

Traceable fixed cost:
A traceable fixed cost is a fixed cost that is incurred because of the existence of
a segment. If the segment had never existed, the fixed cost would have not
been incurred; and if the segment were eliminated, the fixed cost would
disappear.
Non-traceable Common Costs
 Non-traceable common costs
Those costs incurred in the production process which cannot be
attributed directly to any specific activity and so can only be
allocated on an arbitrary basis.

Example
A traceable cost is one which can be identified easily and
indisputable with a unit of operation, e.g., a product, a
department, or a process. Common costs are those that are not
traceable to plant, department, or operation, as well as those that
are not traceable to individual final products, e.g., electric power
for running machines is frequently an example of a nontraceable cost which is nevertheless variable with output
Common Fixed Cost
 Common fixed cost:
A common fixed cost is a fixed cost that supports the
operations of more than one segment, but is not traceable
in whole or in part to any one segment. Even if a segment
were entirely eliminated, there would be no change in true
common fixed cost.

Examples: of common fixed cost include the following:
The salary of general manager who controls all the
segments. The salary of CEO at general motors is also an
example of common fixed cost. No single segment can be
regarded as the sole reason of this cost.
The salary of receptionist at an office shared by a number
of doctors is a common fixed cost of the doctors. The cost is
traceable to the office, but not to any one of the doctors
individually.
Methods of Evaluating
Performance
Marketing Cost Analysis
HOW COSTS ARE DEALT
WITH DEPENDS ON THE
APPROACH USED BY THE
ANALYST. IT CAN BE . . .
Methods of Evaluating
Performance
Marketing Cost Analysis
 FULL-COST APPROACH
 DIRECT-COST APPROACH
Methods of Evaluating
Performance
The Marketing Audit
 Marketing Audit
 Customer-Service Audit
Methods of Evaluating
Performance
The Marketing Audit
 Marketing Audit
 Customer-Service Audit
Question
 Describe the Marketing Implementation Process
components, and the Major Approaches to Marketing
Implementation?